Guyanese Are Becoming Poorer Despite Living in World’s Fastest Growing Economy
(special for OrinocoTribune.com) — With a GDP growth of over 63% in 2022, according to the World Bank, and an estimated GDP growth of about 38% in 2023, Guyana is frequently referred to as the world’s fastest-growing economy. The meteoric rise of Guyana’s GDP is almost entirely due to the exploitation of recently discovered oil reserves by US-based multinational petroleum corporation ExxonMobil, a company that traces its origins to Rockefeller’s Standard Oil company.
“Guyana’s GDP per capita is rapidly increasing due to oil production, which began in 2019 and reached 278,000 barrels per day (bpd) in 2022,” wrote the World Bank. “The country is expected to remain one of the fastest growing economies with double-digit growth rates in 2023 and 2024 as additional oil fields start operation.”
Despite its newfound wealth, Guyana has not succeeded in improving the lives of its impoverished population. Although reliable estimates of poverty levels have not been reported since 2019 — when 48% of the population was assessed as living in poverty — The World Bank stated recently that Guyana’s poverty rate was among the highest in the Latin America and Caribbean (LAC) region.
“As Guyana increases oil production yearly, citizens depend more on overseas relatives for financial help,” stated a recent World Bank report, reported Georgetown, Guyana’s Kaieteur News. “Amidst ramped up oil production and being labeled the fast-growing economy in the world, Guyanese still heavily depend on overseas relatives to send them help to survive,” detailed the news outlet in an article published last month.
“The heavy dependence on remittances by Guyanese to make ends meet daily, despite the abundance of oil resources, further underscores the cries of citizens that the oil money is not reaching them,” continued the article.
Guyana’s emigration rate is among the highest in the world. “More than 55% of its citizens reside abroad,” according to the US Central Intelligence Agency factbook of 2024. As a result of the country’s great poverty and constant emigration, Guyana is one of the largest recipients of remittances relative to GDP globally. “More than 80% of Guyanese nationals with tertiary level educations have emigrated,” continues the CIA factbook. “Brain drain and the concentration of limited medical resources in Georgetown hamper Guyana’s ability to meet the health needs of its predominantly rural population.”
Since the exploitation of Guyana’s oil reserves began in earnest in 2020, the Guyanese population has become increasingly dependent on remittances. A recent World Bank report showed that remittances sent back to Guyana from citizens living and working abroad increased from US $380 million in 2019 to US $549 in 2022, an increase of over 44% in only three years.
“No wonder Guyanese are saying the oil money is not trickling down to them,” said analyst Dr. David Hinds during a recent episode of his Politics 101 program. Hinds noted that, at the same time that the Guyanese state is benefitting from a windfall of new oil money, it has slashed public servants’ wages in an inflationary economic environment. “How can you be talking about the fastest growing economy in the world, and your people are not earning a livable wage?” asked Hinds. “It is a shame.”
“Public servants are vital to the function of Guyana’s government,” commented Guyanese economist Elson Low. “We are now in an oil environment in which there is going to be quite a lot that has to be done to keep things going, even simple things, like ensuring security, like ensuring our health care is provided, like ensuring that our schools continue to function. You know, all of these things, as our economy changes, are even more vital. But public servants are being paid less, by this measure, than they were last year. That is in terms of the real numbers… This is yet another year in which Guyana is going to be the country with the fastest growth in the world.”
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This article was originally published by Orinoco Tribune on January 10, 2024.
